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ENTREPRENEURSHIP I

Ind. 3.02 – Select a target market appropriate for venture/product to obtain the best return on marketing investment. ENTREPRENEURSHIP I. How are marketers grouping you?. Business owners are excited about people’s similarities. Why?

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ENTREPRENEURSHIP I

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  1. Ind. 3.02 – Select a target market appropriate for venture/product to obtain the best return on marketing investment ENTREPRENEURSHIP I

  2. How are marketers grouping you? • Business owners are excited about people’s similarities. Why? • Grouping is how marketers discover the best ways to match products with their customers • It is how marketers figure out what it takes to meet their customer’s needs. • How do you think marketers group YOU?

  3. Market – A group who have…. • An unfilled desire or need, and • Are financially able to pay, and • Have the willingness to buy (soon). “There’s no way this old mower is going to get through this. It’s time to buy a more powerful one!”

  4. Target Market – those who…. • Are grouped within a market by what they have in common • Are the customers the business seeks to attract because they are likely to buy

  5. Target Market • A group of consumers that a business wants as its customers • Consumers = users • Customers = buyers

  6. Significance of target marketing • Every customer belongs to a number of markets. • Customers are targeted in the consumer market, and businesses are targeted in the industrial market. • The same customer or business can be included in more than one target market. • Markets usually change over time. • Keeps the business from wasting its money trying to sell to people that won’t buy.

  7. Two styles of approaching target market activities – Mass Marketing • Mass marketing is designing products and directing marketing activities to appeal to the whole market • Uses a single marketing plan to reach everyone (milk, gum, light bulbs) • Advantages • Used to communicate a broad message to as many customers as possible • Producing one product is cost effective for businesses • Disadvantages • The diversity of the audience • Since customers are so different, only a small percentage of the mass market is likely to purchase the product

  8. Two styles of approaching target market activities – Market Segmentation • Market Segmentation is the division of a total market into smaller, more specific groups as a way to meet the customers needs • Advantages • More precise • Allows for a finely tuned product, appropriate price, and ease of distribution • Disadvantages • More complex, difficult to produce products • More money needed

  9. Why is the use of market segmentation increasing? • It’s more efficient in the long run. • Increased competition • Customers are more discerning than they used to be. • Customers want to know how the good or service will directly benefit them!

  10. How do marketers divide their markets? • They identify customers’ similarities. • They group customers by what they have in common. • Common ways to group customers: • Demographic • Geographic • Psychographic • Behavioral

  11. Demographic Segmentation (Magazines) • Dividing a market on the basis of its physical and social characteristics • Example characteristics: • Gender • Origin or heritage • Religion • Social or economic status • Education level, occupation, income, etc. • Life stage • Generation, marital status, family size, etc.

  12. Geographic Segmentation (Newspapers) • The division of the market on the basis of where customers are located • Type of climate • Continents • Nations • Regions • States • Zip codes • Neighborhoods • Etc.

  13. Behavioral Segmentation • Dividing a market on the basis of consumers’ response to a product • Product Benefit • Occasions • Loyalty

  14. Psychographic Segmentation • The division of a market on the basis of consumers’ lifestyles and personalities • Motives (i.e. fun) • Attitudes • Opinions • Interests • Activities • Personalities • Lifestyle • Values

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